Air New Zealand has lifted its profit guidance for the financial year ending June 30, 2023, six times in just over six months citing strong demand for travel and weaker jet fuel prices. In a statement to the New Zealand stock exchange, the airline said it expects profit before tax and one-time items of at least $580 million in the year to the end of June a turnaround from a pre-tax loss of $725m in FY22.
The latest guidance is ahead of the airline’s April forecast for profit of $510m to $560m, and its initial February forecast of $450m to $530m.
“Since the previous update, the airline has experienced stronger ongoing demand than usually observed at this time of the year, which is typically considered the airline’s off-peak period,” the airline said in a statement.
In FY22 Air New Zealand posted a loss of NZ$ 725 million which followed a loss of NZ$444 million in FY21.
In September 2022, the airline said that the strength in forward bookings and a fall in fuel costs gave it the confidence to expect earnings before taxation and other significant items for the first half of the 2023 financial year to be in the range of NZ$200 to NZ$275 million.
In December, that guidance had climbed to NZ$295 to NZ$325 million for the first half, once again citing strong forward bookings and another drop in the price of jet fuel. By then the airline was flying at 75% of pre-COVID capacity.
By February the airline had returned six Boeing 777-300ERs to service, added three new Airbus A321neos to the domestic fleet and wet-leased an Airbus A330 from Spanish charter airline Wamos Air. Air New Zealand posted earnings of $299 million for the first half and forecast FY23 full-year earnings in the range of NZ$450 to NZ$530 million.
In April, the airline raised its forecast once again eyeing fall in jet fuel prices and continuation of strong demand. Based on that it increased FY23 earnings guidance to be in the range of NZ$510 to NZ$560 million, warning supply chain and inflation might impact the final result.
In the latest update to the stock exchange the airline said that it now expects earnings before other significant items and taxation to be no less than NZ$580 million.